> I don't understand how anyone can use LLMs and not see this instantly

Because people in general are not thorough. I've been playing around with Claude Code and before that, Cursor. And both are great tools when targeted correctly. But I've also tried "Vibe" coding with them and it is obvious where people get fooled - it will build a really nice looking shell of a product that appears to be working, but then you step into using it past the surface layer and issues start to show. Most people don't look past the surface layer, and instead keep digging in having the agent build on the crappy foundation, until some time later it all falls apart (And since a lot of these people aren't developers, they have also never heard of source control.)